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REGULATORY ASSETS AND LIABILITIES (Notes)
 3 Months Ended
Mar. 31, 2020
SCHEDULE OF REGULATED ASSETS AND LIABILITIES [Line Items]  
Schedule of Regulatory Assets and Liabilities .
REGULATORY ASSETS AND LIABILITIES

The tables below present a summary of regulatory assets and liabilities, net of amortization, for the periods indicated:
 
 
 
 
March 31, 2020
 
 
 
 
Current
 
Noncurrent
 
Total
 
 
 
 
(Thousands of dollars)
Pension and postemployment benefit costs
 

 
$
21,199

 
$
363,467

 
$
384,666

Reacquired debt costs
 

 
812

 
5,474

 
6,286

MGP remediation costs
 
 
 
98

 
9,685

 
9,783

Ad-valorem tax
 

 
3,593

 
—

 
3,593

Weather normalization
 
 
 
3,713

 
—

 
3,713

Other
 

 
10,393

 
2,060

 
12,453

Total regulatory assets, net of amortization
 
 
 
39,808

 
380,686

 
420,494

Federal income tax rate changes
 
 
 
(6,282
)
 
(494,210
)
 
(500,492
)
Over-recovered purchased-gas costs
 
 
 
(27,367
)
 
—

 
(27,367
)
Total regulatory liabilities, net of amortization
 
 
 
(33,649
)
 
(494,210
)
 
(527,859
)
Net regulatory assets and liabilities
 
 
 
$
6,159

 
$
(113,524
)
 
$
(107,365
)
 
 
 
 
December 31, 2019
 
 
 
 
Current
 
Noncurrent
 
Total
 
 
 
 
(Thousands of dollars)
Under-recovered purchased-gas costs
 

 
$
17,172

 
$
—

 
$
17,172

Pension and postemployment benefit costs
 

 
21,213

 
373,266

 
394,479

Reacquired debt costs
 

 
812

 
5,677

 
6,489

MGP remediation costs
 
 
 
98

 
9,709

 
9,807

Ad-valorem tax
 
 
 
2,921

 
—

 
2,921

Other
 

 
5,224

 
2,384

 
7,608

Total regulatory assets, net of amortization
 
 
 
47,440

 
391,036

 
438,476

Federal income tax rate changes
 
 
 
(10,297
)
 
(503,518
)
 
(513,815
)
Over-recovered purchased-gas costs
 

 
(27,623
)
 
—

 
(27,623
)
Weather normalization
 
 
 
(7,281
)
 
—

 
(7,281
)
Total regulatory liabilities
 
 
 
(45,201
)
 
(503,518
)
 
(548,719
)
Net regulatory assets and liabilities
 
 
 
$
2,239

 
$
(112,482
)
 
$
(110,243
)


Regulatory assets in our consolidated balance sheets, as authorized by various regulatory authorities, are probable of recovery. Base rates and certain riders are designed to provide a recovery of costs during the period such rates are in effect, but do not generally provide for a return on investment for amounts we have deferred as regulatory assets. All of our regulatory assets are subject to review by the respective regulatory authorities during future regulatory proceedings. We are not aware of any evidence that these costs will not be recoverable through either riders or base rates, and we believe that we will be able to recover such costs consistent with our historical recoveries.

Federal income tax rate changes represent the effect of the Tax Cuts and Jobs Act of 2017. In each state, we received
accounting orders requiring us to establish a regulatory liability for the difference in taxes included in our rates that have been
calculated based on a 35 percent federal corporate income tax rate and the new 21 percent federal corporate income tax rate
effective in January 2018 and to refund the reduction in ADIT due to the remeasurement resulting from the change in the
effective tax rate. This balance reflects the balance portion of the credit resulting from the 2018 Oklahoma Natural Gas PBRC that was accrued in 2018 and is being credited to customers over a 12-month period that began in August 2019. In addition, this balance reflects the remeasurement of our ADIT in 2017 as a result of the Tax Cuts and Jobs Act of 2017. Our customers began receiving credit for this liability as determined by our regulators in 2019. Our customers receive credit annually based upon an amortization period in compliance with the tax normalization rules for the portions of EDIT stipulated by the Code and varying periods of five to ten years for all other components of EDIT. Three service areas in Texas have authorized EDIT to be credited to customers annually. The timing of the return of EDIT to customers in our remaining three service areas in Texas will be determined as we work with our regulators. Income tax expense for the first quarter 2020 and 2019 reflects credits of $6.9 million and $6.7 million, respectively, for the amortization of the regulatory liability associated with EDIT that was returned to customers.

In April 2020, Kansas Gas Service filed an application with the KCC for an AAO to accumulate and defer certain incremental costs incurred, including increased bad debt expenses and lost revenues, as well as associated carrying costs related to COVID-19 beginning March 1, 2020 for recovery in Kansas Gas Service’s next rate case filing. In April 2020, the Public Utility Division of the OCC is expected to file an application to allow all utilities in Oklahoma to defer, as a regulatory asset, incremental expenses, including increased bad debt expenses and/or impacts to revenue that are outside the utility’s control or a direct result of the utility’s COVID-19 response, beginning March 13, 2020. We expect regulatory action on the proposed applications in Kansas and Oklahoma in the second quarter 2020. In April 2020, the RRC issued an order authorizing utilities to use an accounting mechanism and a subsequent process through which Texas Gas Service may seek future recovery of incremental expenses resulting from the effects of COVID-19, including bad debt and associated credit and collections costs, and other reasonable and necessary incremental costs to address the impact of COVID-19.